-

Except for the Second Income Plan, all income maintenance programs including the guaranteed annual income, the negative income tax, the expansion of unemployment compensation, governmental employment or subsidization of employment of the unemployed, etc. -- utilize Route I redistribution of output of the existing economy.

-

The Second Income Plan alone utilizes Route II.

ONE-FACTOR ECONOMIC CONCEPTS

and

TWO-FACTOR ECONOMIC CONCEPTS:

The income maintenance hangup is, and has always been, the attempt to make one-factor economic concepts work in a two-factor real world. Let me now explain two-factor theory:

-

in half a minute

-

It is the idea that each of the two factors produces wealth in exactly the same

sense:

This idea is contrary to explicit
socialist dogma.

It is also contrary to U.S. economic
policy: the Employment Act of 1946
and the Economic Opportunity Act of
1964.

Both political parties espouse one-
factor economic policy.

The various studies on economic goals
that have been made in the U.S. since
the T.N.E.C. studies of 1938-42 uni-
formly conclude that our proper
economic goal is full employment, so
they are contrary to two-factor theory.

Two-factor theory is contrary to
Keynesian doctrine.

While physical capital does not pass unnoticed in the western economies, we assert that its function is to enhance the "productivity of labor.'

This, of course, is contrary to reality
and to two-factor theory.

If two-factor theory is sound, and if double-entry bookkeeping is the logic of a market economy, then the only way to eliminate